Leadership and the Chicago Transit Authority (CTA)

Written By: Prem Kumar, Olabinjo Osundairo, Liane Torcoletti, and Devenless Wiltz MGMT 591 Olinda L. Lemus and Allen A. Rodriguez 11/22/2014
Introduction
Chicago Transit Authority, better known as The CTA was created in April 12, 1945 by the Act of the General Assembly of Illinois due to the unprofitability of the privately owned public transit that once existed in the Chicago area. The CTA is the second largest transportation system with the United States. There is approximately 1.7 million rides taken on The CTA transportation systems each day and the regional transit system provides services to 35 suburbs (TransitChicago). The CTA rail system comprises of 1865 buses that serves over 127 routes and make about 19,000 trips a day and serve 11,104 bus stops, and their train system comprises of 1,356 rail cars which operate over 8 routes and 224.1 miles of track, making 2,250 trips each day, serving 145 stations (TransitChicago). Before The CTA was created, it was comprised of 5 separately owned companies who managed the street railway systems. The railroad system back then and now was known as the ‘L’. The original L companies that were privately owned and controlled the railroad transportation system here in Chicago were the South Side L, the Lake Street L, the Metropolitan West Side L, the Union L, and the Northwestern L (Chicago L.org). From 1947 to 1970 as The CTA took control over the railway systems from the Chicago Rapid Transit company which was a privately owned company under public regulations, different modernization objectives were inserted into the railway system in order to resurrect the broken system. But eventually the CTA inevitably ran into the same problems that its predecessor also fell prey to (Chicago L.org). Due to the CTA’s inability to control costs, the Regional Transportation Authority also known as the RTA was created in 1974 which by the use of a special taxing district could support each transit system in Chicago as it saw fit but left the CTA intact so to avoid allowing the suburbs to have complete control over transit issues (Chicago L.org). Today The CTA faces a new kind of a situation which it is finding to be very problematic and costly to it doing business. Some say that the employees are the problem to the recent downfall of services and profitability within the company but are the real issues really coming from the Leadership and is it the company culture that has been instilled for decades now that is to be blamed?
Problem Statement The problem within the CTA today is its leadership tactics, mistreatment of employees, the company’s culture that has been instilled within the company for decades now, and certain managerial actions which have led managers to violate their own discipline policies. For many years now CTA has been borrowing millions of dollars just to pay for its operating costs. There have been rumors that another increase to fare rates might be imposed to help cover some of the costs. This idea though does not sit well with many passengers who are already upset with the longer waits and crowded buses which already exist on the busses and trains. The president of the CTA Forrest Claypool blames these predicaments on the employees and claims the longer waits and more crowded buses are due to the chronic absenteeism of the employees. He says this large shortage in manpower causes the cancellation of hundreds of busses and trains each month which results in costs of 40 million dollars this year already. The transit union leaders claim that the numbers provided by president Claypool are extremely exaggerated and are